We can apply the same principles of segmentation to sales in the pharmacy that I have described for prescriptions providing a more useful set of management information that will allow you to make decisions that will improve profitability.

We don’t need to go mad creating dozens of categories of sales as the utility of this information will decrease as the size of the category decreases. Three initial categories might include

• Core sales – those things that people regularly buy from the pharmacy
• Distress sales – those things that might not fit into another category but people might buy from the pharmacy in an emergency (e.g. tights if your pharmacy is on a high street)
• Impulse sales – those things, often sold as an offer, that people might buy on impulse when they visit the pharmacy.

Core sales can further be subdivided into categories which might include: medicines, healthcare, VMS, toiletries, beauty, household, and perfume. These categories will be individual to a pharmacy based on its sales profile and local competition. 

The contribution made to profit by each of these categories can be calculated in the same ways as described for dispensing categories. Developing top line sales into more granular management information in this way will prompt you to review any categories that do not perform well.

There are further measures to consider for retail sales. Stock management and stock turnover are important measures of performance. Overstocking leads to loss in profits due to money being tied up unnecessarily. One category might be overstocked leading to too little space available of a second category that provides a better profit contribution to the business.